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December 2, 2005 10:37 AM PST

IDC: Tech to see 'Google effect' next year

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Next year will bring moderate growth in IT spending, which will push many vendors into taking the plunge and developing some disruptive business models.

That's the view of analyst group IDC, which on Thursday published its predictions for the coming year.

IDC predicted that global spending on IT would grow by 5.5 percent in 2006. Coming on the back of 6 percent growth in 2005, this will force more technology companies into offering IT as a service, predicted Frank Gens, senior vice president of research at IDC.

"A critical new ingredient we'll see (in 2006) is the acceleration of disruptive business models; 'open innovation' in IT product and service development--the open-source effect--and online delivery of IT as a service--the Google effect," Gens said in a statement. "These disruptive shifts will force most vendors to perform a strategic 'gut check' as they enter the year."

The "Google effect" that Gens described would be prompted by the fear that the search giant will dominate more markets in the years ahead.

"While much of this disruption will be years in the making, and will be overhyped in 2006, the more important impact of 'Google as a disrupter' will be as a spur for traditional suppliers to disrupt themselves before competitors do. This will be evident in enterprise applications, information management and IT services," IDC said.

Gens also believes that open-source-like collaboration will grow in popularity.

"Most of the big market share leaders in IT--e.g., Microsoft, IBM, Oracle, SAP--got that way by keeping tight control over their own product development. The 'go it alone' model of innovation is an endangered species in the IT industry, and incorporating a community-based innovation model--e.g., open source--is quickly becoming an important ingredient for market leadership," IDC said.

"In 2006, IDC believes that building more open innovation communities will be a big focus for IT leaders--including Microsoft," the analyst firm predicted.

This year has seen a clutch of acquisitions, from Adobe Systems' merger with Macromedia to eBay's purchase of Skype. IDC expects that this trend will continue in 2006, as few vendors have finished reshaping themselves.

Graeme Wearden of ZDNet UK reported from London.

See more CNET content tagged:
information technology, Google Inc., innovation, open source, technology company

Add a Comment (Log in or register) 7 comments
Blog Spam?
by Wuzzard December 2, 2005 12:16 PM PST
I think this article has just been hit with the equivalent of blog spam.
Reply to this comment
Relatively Speaking... is it possible to Google Microsoft;and,...
by Captain_Spock December 2, 2005 2:20 PM PST
...also "Google"__ Google in a disruptive manner by offering ads-free computer hardware and software to small and medium companies worldwide -- they however enter into a "desktop services" (plus hardware and software upgrade -- "OS/2, Linux and OpenOffice distros") contract with companies such as, lets say -- Intel, Sun, IBM and Lenovo for 3-5 years.
Reply to this comment
My God...
by Betty Roper December 2, 2005 3:53 PM PST
What is happening to CNet?

The articles are nothing but pure hype -- practically written by the PR division of Google -- and the comments are spam.

What happened to this site?
Reply to this comment
More specifics on your comment?
by pencoyd April 24, 2008 8:30 PM PDT
Comments vary by the poster, certainly.

As to the quality of the articles, please be specific, or reply to the author (bylines are linked to email addresses) directly with comments or questions.

Thanks for reading CNET News.com.

John Roberts
CNET News.com product development
Very Well Thought Out Predictions!
by Captain_Spock April 24, 2008 8:30 PM PDT
>>>>"A critical new ingredient we'll see [in 2006] is the acceleration of disruptive business models; 'open innovation' in IT product and service development--the open source effect--and online delivery of IT as a service--the Google effect," said Gens in a statement. "These disruptive shifts will force most vendors to perform a strategic gut check as they enter the year."<<<< Let us all sit back and wait and see how these will come through in 2006! ;-)
Reply to this comment
"this will force more technology companies...
by Captain_Spock April 24, 2008 8:30 PM PDT
... into offering IT as a service, predicted Frank Gens, senior vice-president of research at IDC"; and, Coming_soon_with_ a_disruptive_business_model_will_be:

http://www.OrionResourcesIntl.com
Reply to this comment
Google
by April 24, 2008 8:30 PM PDT
Google is fast becoming the money gouging company that Yahoo
and Overture represent.
Reply to this comment
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